Latest news with #CharteredInstituteofTaxation
Mint
6 days ago
- Business
- Mint
Why does the British tax year end on April 5th?
For Britons the end of the tax year looms on April 5th. Why such a seemingly random date? In the Middle Ages England's tax year—or a nascent version of it—ended on Lady Day, March 25th, a religious festival by when debts had to be settled. The country, like most of Europe, used the Julian calendar. But Julius Caesar's system was flawed, and in 1582 continental Europe, on Pope Gregory XIII's orders, shifted to a more accurate model. Protestant England resisted. By the mid-18th century England was 11 days behind the continent, creating scope for confusion in trade and diplomacy. To catch up it made a one-off excision of a week and a half from September 1752. People would go to sleep on September 2nd and wake up on the 14th. At the time, tax was charged not on income but on land and windows. These were annual payments, so to keep the tax period at 365 days people were given 11 extra days to settle their bill. Then, in 1758, the window-tax year was explicitly extended by 11 days, to April 5th. This was the date used when William Pitt the Younger introduced income tax in 1799, and has marked the close of the tax year ever since. Some may see this as an example of Britain's loveable eccentricity, others as a symbol of the arcane nature of the British tax code itself. The April date puts Britain at odds with countries such as America, France and Germany, all of which harmonise with the calendar year. Indeed, it does not coincide with the British government's own financial year, which begins (don't ask why) on April 1st. The Chartered Institute of Taxation, a body for tax professionals, says getting in sync with other countries would increase efficiency and reduce friction. Despite its name, the Office of Tax Simplification (OTS), an independent body within the Treasury, pointed in a 2021 report to the administrative effort that would be involved in changing the date, though it conceded that 'a tax year aligned to the calendar year would be the natural, simplest and easiest approach". Don't hold your breath: the OTS was abolished in 2023. Correction (March 31st 2025): The original version of this article mistakenly attributed the Gregorian calendar to Pope Gregory III, not XIII. Sorry. For more expert analysis of the biggest stories in Britain, sign up to Blighty, our weekly subscriber-only newsletter.
Yahoo
14-03-2025
- Business
- Yahoo
HMRC issues new £3,000 allowance for thousands of people
HMRC announced an increase in the Income Tax Self Assessment (ITSA) reporting threshold from £1,000 to £3,000 on March 11. Up to 300,000 people, including those with side hustles, will no longer need to file a Self-Assessment tax return. This includes people trading clothes online, dog-walking or gardening on the side, driving a taxi, or creating content online. This will benefit around 300,000 taxpayers. An estimated 90,000 of them will have no tax to pay and no reason to report their trading income to HMRC in the future at all. Others will be able to pay any tax they owe through a new simple online service. READ MORE: Blue Badge rule change means 1.35 million could wrongly pay £195 READ MORE: Fred Sirieix fears London has 'is so quiet' as Kirstie Allsopp blames people being 'scared' to go out Exchequer Secretary to the Treasury, James Murray said: "From trading old games to creating content on social media, we are changing the way HMRC works to make it easier for Brits to make the very most of their entrepreneurial spirit. "Taking hundreds of thousands of people out of filing tax returns means less time filling out forms and more time for them to grow their side-hustle." Mr Murray, the minister responsible for HMRC, announced this reform on March 11 to tax experts hosted by the Chartered Institute of Taxation and the Institute of Chartered Accountants in England and Wales in a speech to mark the 20th anniversary of HMRC. Eve Williams, CEO of eBay UK, commented: "This will be welcome news for thousands of UK sellers for whom eBay is a side hustle and a means of supplementing their household income during challenging times. "By removing the paperwork associated with selling online, hopefully we will help these side hustles grow into fully fledged small businesses." Looking for more from MyLondon? Subscribe to our daily newsletters here for the latest and greatest updates from across London.
